Federal restrictions preventing Medicaid reimbursement for non-abortion services at Planned Parenthood have ended, restoring coverage for routine healthcare provided at these clinics. States now have discretion to determine whether Medicaid enrollees can access covered services at Planned Parenthood locations that remain operational. The change takes effect immediately, reversing a previous ban that prohibited Medicaid payment for any services delivered by Planned Parenthood providers, including primary care, family planning, STI testing, and cancer screenings. Medicaid managed care organizations must now determine network participation and reimbursement policies for these providers according to state guidance.
Why it matters for managed care
MCOs must update provider networks, claims systems, and member communications to reflect reinstated coverage of qualified services at Planned Parenthood clinics, subject to state-specific participation rules.
The Congressional Budget Office's February 2026 projections show significant reductions in Medicaid enrollment and federal spending over the next decade following passage of the 2025 reconciliation law. The analysis compares current projections to pre-reconciliation baselines, quantifying the impact of policy changes including eligibility restrictions, state flexibility provisions, and federal funding modifications. CBO accounts for both legislative changes and updated economic assumptions in projecting enrollment trends and program costs through 2036. The projections provide the first comprehensive federal assessment of how reconciliation provisions will reshape Medicaid program size and federal financial participation.
Why it matters for managed care
These projections establish the federal baseline for managed care organizations to model membership losses, revenue impacts, and state contract modifications as reconciliation provisions phase in.
The Government Accountability Office reports that federal Medicaid and Medicare spending for services provided in assisted living facilities totaled at least $12 billion in 2024, including $3.5 billion in federal Medicaid spending and $8.5 billion in Medicare spending. Forty-four states cover assisted living services through their Medicaid programs, with 29 states using home- and community-based services (HCBS) waivers as of March 2025. GAO notes the $12 billion figure is likely an undercount due to data limitations, as assisted living facilities are not uniformly defined or consistently identified in program data. Medicare generally does not cover assisted living services but covers other health care such as hospice in these settings.
Why it matters for managed care
This GAO analysis quantifies federal spending in assisted living settings and confirms HCBS waivers remain the dominant coverage mechanism for 29 states, affecting MCO long-term services and supports benefit design and network requirements.
The HHS Office of Inspector General reviewed Part D plan formularies for 2026 and found that plans generally include drugs commonly prescribed to dual-eligible beneficiaries. The analysis examined formulary coverage patterns for medications frequently used by individuals enrolled in both Medicare and Medicaid. The report provides insight into whether dual eligibles have adequate access to needed medications through Part D coverage. This matters for Medicaid managed care organizations that coordinate benefits for dually eligible members and must ensure continuity of pharmacy coverage across programs.
Why it matters for managed care
MCOs serving dual eligibles must coordinate Part D and Medicaid pharmacy benefits, and formulary adequacy directly affects care continuity, member grievances, and wraparound coverage obligations.
The Drug Enforcement Administration announced plans to temporarily classify 7-hydroxymitragynine (7-OH) and three related synthetic kratom compounds as Schedule I controlled substances, placing them in the same regulatory category as heroin and LSD. The classification applies to synthetic versions of the psychoactive compound found in kratom products. If finalized, the scheduling action would prohibit manufacture, distribution, and possession of these substances, with enforcement implications for entities handling these compounds. The timing of implementation and comment period was not specified in the available content.
Why it matters for managed care
Medicaid MCOs covering behavioral health or substance use disorder treatment may need to update formularies, prior authorization protocols, and member communications if kratom-containing products are used by enrollees for pain or opioid withdrawal management.
State Medicaid agencies report concerns that sick and disabled enrollees will lose coverage under a narrowed federal definition of "medically frail" used for work requirement exemptions. The change stems from legislation President Trump signed last year requiring states with Medicaid expansion to implement work requirements. State officials fear the tightened criteria will disqualify many enrollees who previously qualified for exemptions, forcing them into compliance or disenrollment. The policy directly affects how managed care organizations identify and retain vulnerable members.
Why it matters for managed care
Managed care organizations will need to update member screening protocols, recalibrate enrollment forecasts, and prepare care management teams for potential member churn as medically frail determinations tighten under federal work requirement rules.
State legislatures concluded 2026 sessions with varied responses to federal Medicaid cuts enacted under H.R. 1 approximately one year ago. States faced budget shortfalls and policy changes requiring legislative action to address coverage gaps, provider payment reductions, and program restructuring. The article follows up on earlier reporting from March 2026 that examined ten state responses to what are described as the largest Medicaid cuts in history. Implementation timelines and specific state actions vary by jurisdiction.
Why it matters for managed care
State legislative responses to H.R. 1 determine MCO contract terms, capitation rate methodologies, benefit packages, and eligibility rules that directly govern managed care operations in affected states.
Federal cuts to Medicaid and SNAP programs are becoming a central issue in Nevada's 2026 gubernatorial race, potentially affecting Republican Governor Joe Lombardo's reelection bid. The state, a key battleground with significant Medicaid enrollment, faces voter concern over healthcare affordability as federal funding reductions take effect. The political dynamics may influence state policy decisions on Medicaid expansion, managed care contracts, and benefit design as the election approaches. Nevada's Medicaid managed care organizations should monitor how electoral pressure shapes state budget negotiations and program priorities.
Why it matters for managed care
Political vulnerability over Medicaid cuts may accelerate state action to preserve benefits or shift costs to plans, affecting MCO margins and contract terms in Nevada.
On June 23, 2026, the Department of Justice announced criminal charges against 455 defendants, including approximately 90 licensed medical professionals, connected to more than $6.5 billion in alleged false claims. DOJ characterized this as the largest coordinated health care fraud enforcement action in its history and emphasized a renewed focus on Medicaid fraud cases. The takedown included enforcement actions in Virginia and multiple other states. Charges took effect immediately upon announcement, with defendants facing federal prosecution.
Why it matters for managed care
This enforcement action signals intensified federal scrutiny of Medicaid billing practices and provider networks, requiring MCOs to strengthen fraud detection protocols and accelerate reviews of high-risk provider relationships to mitigate compliance exposure.
A federal judge has blocked Colorado's Drug Affordability Board from implementing a price cap on Amgen's Enbrel, a blockbuster rheumatoid arthritis medication. The ruling prevents the state board from enforcing its pricing limit on the drug. The decision affects Colorado's ability to use its drug affordability review process to control costs for high-priced medications. This represents a significant setback for state efforts to directly regulate pharmaceutical pricing through affordability boards, with implications for how states can address drug costs in Medicaid programs.
Why it matters for managed care
The ruling limits states' ability to impose price caps on high-cost medications, potentially constraining Medicaid managed care organizations' options for controlling pharmacy costs and challenging state-level drug affordability initiatives that MCOs rely on to manage specialty drug spending.
A federal court has dismissed a lawsuit filed by Express Scripts, CVS Caremark, and Optum Rx against the Federal Trade Commission. The three pharmacy benefit managers had sued the FTC after the agency accused them of inflating insulin costs, but the case is now closed following settlements between the PBMs and regulators. The settlements resolve the FTC's allegations regarding the PBMs' role in insulin pricing practices. The dismissal comes after the parties reached resolution on the underlying insulin pricing dispute.
Why it matters for managed care
Medicaid managed care organizations that contract with these three PBMs for pharmacy services need to understand the terms of these insulin pricing settlements, as they may affect rebate structures, formulary management requirements, and insulin cost-sharing obligations for Medicaid beneficiaries.